BOCA RATON, FL-Geo Group Inc., the locally based operator of prisons and residential treatment facilities worldwide, suffered a series of setbacks and one-time charges that negatively impacted its 2005 financial performance. Despite this, revenue increased to $612.9 million, up from $594 million in 2004.

"We have effectively overcome the challenges," George C. Zoley, chairman and CEO, said during a conference call. As evidence, the company raised its previous 2006 revenue guidance by $2 million, targeting a range of between $729 million and $745 million. The additional $2 million is anticipated during this year's opening quarter when revenue is expected to range between $182 million and $186 million.

During fourth quarter 2005, earnings fell to $3.6 million, down from $5.2 million in the same quarter the previous year. Gains for the quarter were offset by an impairment charge of $12.6 million related to the closing of a Michigan correctional facility. The company also incurred one-time costs related to a required reclassification of some job positions from exempt to non-exempt status and increased employee healthcare costs. Prior to fourth quarter, it incurred losses from a declining inmate population at its San Diego facility.

Among the "challenges" met, according to Zoley, is a new, 10-year fixed payment contract for the San Diego facility, which he said, "eliminates any future financial risks associated with inmate occupancy fluctuations." Geo also has new contracts for management of the 2,416-bed New Castle Correctional Facility in New Castle, IN and the 230-bed Fort Bayard Medical Center in Fort Bayard, NM.

Following the March 13 conference call, GGI stock on the NYSE rose to $24.86 a share, up 7.3% for the day. The 52-week high of $30.91 a share occurred on March 23, 2005, and shares reached a 52-week low of $20.10 on Nov. 2, 2005.